Thursday, July 20, 2006

At the book forum on Tuesday announcing the release of the new book, Net Neutrality or Net Neutering: Should Broadband Internet Be Regulated, which I co-edited with my former colleague Tom Lenard, I made the point that the current campaign to impose "net neutrality" regulation on broadband service providers, in effect, is nothing more than an effort to re-impose the same type of strict non-discrimination common carrier obligations on the broadband ISPs that were at the heart of each the three Computer Inquiry proceedings that played out at the FCC during the 60s, 70s, and 80s. I said that the current attempt to impose neutrality mandates on broadband providers could just as well be called Computer V, Computer IV being the failed campaign of a few years ago to impose "open access" requirements on cable operators.

For those fortunate enough to be too young too know these things, I pointed out Computer I was begun in 1966, when, yes, Virginia, AT&T did possess dominant market power. As computers began to be connected via communications, and new applications integrating data processing and communications emerged, the central idea of the Computer Inquiries was to prevent AT&T (and then post-divestiture, its Bell Company progeny) from using dominant market power to discriminate against newly emerging "enhanced" service providers. At that time, in the then-narrowband world still largely characterized by the market power of the Bell companies, the Computer Inquiry rules requiring strict separation of transmission and content and carrier non-discrimination made some sense.

But, as I pointed out at the book forum, as far back as its 1981 Computer II decision, even as the the FCC was imposing non-discrimination obligations, the agency predicted that "technological trends suggested that hard-wired access provided by the telephone company will not be the only alternative." It recognized even then that, as a result of technological developments, the communications marketplace was beginning to become more competitive.

Now flash forward a quarter of a century later. The FCC's prediction was correct, of course. With cable operators, satellite providers, and wireless companies all competing with the telephone companies, the broadband marketplace is radically different than the narrowband world that gave us the Computer I, II, and III proceedings. Over four years ago, based on an extensive record, the FCC determined that the broadband marketplace is competitive and that broadband ISPs such as Comcast, Verizon, and the like are not common carriers subject to the Communications Act's rate regulation and non-discrimination obligations. Of course, the broadband marketplace is even more competitive now then when the Commission made that finding, and is becoming more so every day.

So, it's discouraging that, in this changed marketplace environment, net neutrality advocates are trying to re-impose quarter-century old Computer Inquiry mandates that no longer make sense in today's world. You might as well call this new regulatory effort by what it is: Computer V. At least that way, you can easily trace its origins back to 1966, a far-away time with a marketplace terrain that now is almost a distant memory.